The Pros and Cons of a Credit Card Balance Transfer

If you have any debt, then you can know how much of a weight around your neck it can be. It can be a long and frustrating journey to becoming debt free. It can take even longer if you are paying high-interest rates for the debt too. There are some ways that you can move around your money and pay it off a little faster. One of those ways might be a credit card balance transfer. There are pros and cons of doing it, though. So read on to see if a credit card balance transfer is going to work for you.

Though you might be in debt, you can still have a good credit rating. As long as you are making your repayments on time. So the chances are that you might get offers of new credit cards with zero percent on balance transfers. It is as straightforward as it sounds; you transfer your debt from one card to another. The zero interest rate won’t last forever, though. It helps to have six or twelve months interest-free. Then you can work to clear your debt, without it growing around you. You might find some cards do it for as high as twenty or twenty-four months. So look for a card that will be best for you and your situation. Then you can make the most out of the situation and clear large chunks of debt. If you need some more information, you could look at somewhere like The Fortunate Investor. It has some articles about credit cards so might be worth a look.

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Be sure to do your research, though. If you think that something is too good to be true, then the chances are that it is. For a lot of people, a balance transfer is just a sidestep to help them clear debt. But if you don’t do your research, it can end up costing a little more. There might be a zero percent interest charge, but is there no transfer fee? If there is, how much will it be? If it is a percent of the debt you are transferring, then is it going to be worth it? If you have a large amount to transfer, then I doubt that it would be. You also need to check how much debt you could clear before the normal interest rate starts. When the normal rate starts, it will most likely be quite a high amount. So unless you just keep transferring, it can cost you a lot.

The key thing is to know you and how you plan to get out of debt. If having a new credit card would be too tempting for you, then don’t do it. If you have done the research and the homework, and it all balances out, then it could be worth doing it. Just make sure that you go in with your eyes open. Then you will know how much you will end up paying in the long term.

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